Broadcom Ltd.

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AVGO : NASDAQ : Electronic Technology
$249.63 up 0.74 | 0.3%
Today's Range: 247.52 - 255.74
Avg. Daily Volume: 3439300.0
02/20/18 - 3:59 PM ET

Financial Analysis


BROADCOM LTD's gross profit margin for the fourth quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. BROADCOM LTD is extremely liquid. Currently, the Quick Ratio is 5.40 which clearly shows the ability to cover any short-term cash needs. The company managed to increase its liquidity from the same period a year ago, despite already having strong liquidity to begin with. This would indicate improved cash flow.

During the same period, stockholders' equity ("net worth") has increased by 7.37% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q4 FY17 Q4 FY16
Net Sales ($mil)4844.04136.0
EBITDA ($mil)4070.01621.0
EBIT ($mil)1646.0921.0
Net Income ($mil)532.0-632.0


Balance Sheet Q4 FY17 Q4 FY16
Cash & Equiv. ($mil)11204.03097.0
Total Assets ($mil)54418.049966.0
Total Debt ($mil)17548.013642.0
Equity ($mil)20285.018892.0


Profitability Q4 FY17 Q4 FY16
Gross Profit Margin65.3263.3
EBITDA Margin84.0239.19
Operating Margin33.9822.27
Sales Turnover0.320.26
Return on Assets3.1-3.48
Return on Equity8.37-8.64
Debt Q4 FY17 Q4 FY16
Current Ratio6.262.31
Debt/Capital0.460.42
Interest Expense119.0106.0
Interest Coverage13.838.69


Share Data Q4 FY17 Q4 FY16
Shares outstanding (mil)408.73398.28
Div / share1.020.51
EPS1.24-1.44
Book value / share49.6347.43
Institutional Own % n/a n/a
Avg Daily Volume3540437.03013428.0

Valuation


BUY. BROADCOM LTD's P/E ratio indicates a significant premium compared to an average of 37.56 for the Semiconductors & Semiconductor Equipment industry and a significant premium compared to the S&P 500 average of 25.51. To use another comparison, its price-to-book ratio of 5.07 indicates a significant premium versus the S&P 500 average of 3.26 and a significant discount versus the industry average of 6.88. The current price-to-sales ratio is well above the S&P 500 average, but below the industry average.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
AVGO 62.64 Peers 37.56   AVGO 15.71 Peers 23.82

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

AVGO is trading at a significant premium to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

AVGO is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
AVGO 12.12 Peers 20.48   AVGO 0.16 Peers 0.82

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

AVGO is trading at a significant discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

AVGO trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
AVGO 5.07 Peers 6.88   AVGO 206.06 Peers 103.74

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

AVGO is trading at a significant discount to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

AVGO is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
AVGO 5.84 Peers 5.96   AVGO 33.20 Peers 22.16

Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

AVGO is trading at a valuation on par with its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

AVGO has a sales growth rate that significantly exceeds its peers.

 

 

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